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Student loans are one of life's biggest financial entanglements, yet they are sorely misunderstood. Many students couldn't tell you if they have private or public loans. All they know is that they owe, owe, owe.

President Obama started a three-state tour, stumping his student loan campaign today, calling for reduced loan interest for college students. A 2007 law that kept federally subsidized Stafford loan interest rates low will expire July 1, if Congress doesn't extend them. Interest rates on some 7.4 million student loans will double from 3.4 to 6.8 percent.

But not everyone will be effected by the increase. “Only undergraduate loans will go from 3.4 to 6.8 percent. Graduate loans stay at 6.8 percent,” says Mark Kantrowitz, publisher of FinAid.org. “There is a lot of confusion about student loans. I read in the paper where someone with $8,000 in student loans is saying that they won't be able to afford the loans when they double. Only new loans will be 6.8 percent. Old loans will not change. And some students don't realize that they will not feel the impact of the increase today, but when they graduate and start paying.”

However, when it comes to student loans, there's little reason to celebrate. Students have long had the luxury of having a six month grace period right after graduation when the government paid their interest. Come 2013 and 2014, that perk disappears in one of many cost saving measures. Last year Congress cut $8 billion from the Pell Grant program and this year lopped off another $2 billion. “The income threshold changed for Pell Grants from a household income of $32,000 to $23,000, which resulted in some getting $1,200-$1,700 less in grants,” says Kantrowitz. Pell Grants are facing a $10 billion shortfall, he adds.

Meanwhile the big battle in Washington is over how to come up with $6 billion to preserve the 3.4 percent interest rates. “That $6 billion is only enough to extend it for one year. Where is the money going to come from?” asks Kantrowitz. Then too, say the extension happens, the next question is, what about the following year, and the next? “The proposals are driven by politics as much as policy,” says Kantrowitz.

Truth is, there are a lot of band aids out there for a situation that requires major surgery – outrageous higher education costs. The last decade has been one of sharp decline in college affordability.

There are tough choices to be made, just like now as the college financial aid offers continue to come in. If you think there's confusion around student loans, according to published reports, college's financial aid offers leave a lot to be desired.

“There needs to be better disclosure in what you're really getting. What are the true costs? The offers sometimes combine loans and grants, it's hard to know what exactly you're getting. College is one of a few major expenses where there aren't standardized disclosure documents, unlike when you buy a home, for example,” says Kantrowitz.

It's about rethinking options. “Go to lower priced schools, in-state public colleges. We have a list of 74 colleges on our website that replace loans with grants,” says Kantrowitz.

When did college financing get to be such a murky, messy, trillion dollar albatross? Troubling thing is, this baby is not growing up and going away any time soon. Says Kantrowitz, “Even when you retire, the government can garnish your Social Security checks. If you're disabled and you default on your loans, the government will take 15 percent of your Social Security. Defaulting on student loans is a trip through hell, there's no way out.”